Your firm has been engaged to audit the financial report of Pellerton Ltd. In obtaining an understanding of internal control relating to purchases, the following questionnaire is used:

1.Are all purchase orders supported by an authorised purchase requisition?

2.Are deliveries received checked to ensure all goods on the delivery have been received in good condition?

3.Is the goods delivery note agreed to the approved order?

4.When goods are received is the inventory system amended to reflect the new delivery?

5.Are purchase invoices agreed to delivery notes?

6.Are mathematical checks performed on purchase invoices before they are processed?

7.Are payments made only after receiving and reconciling supplier statements?

8.Are all payments requested supported by authorised invoices?

9.Are all amendments to purchase ledger accounts authorised by the purchase ledger supervisor?

Required

Identify a potential misstatement that could occur, assuming a No answer to each question